Wells Fargo hopes this is the last shoe to fall in the Phony Accounts scandal unearthed in 2016. The company recently agreed to a $575 million settlement with all 50 state attorneys general over violations of state consumer protection laws tied to the opening of unauthorized bank accounts and unwanted insurance policies in its clients’ names.
Previously, Wells Fargo admitted its employees created unauthorized accounts in order to meet quote demands by managers. The company paid over $600 million in restitution to 3.5 million of its customers through settlements with the Comptroller of the Currency, Consumer Finance Protection Bureau and a class-action lawsuit. In addition, Wells Fargo has paid more than $1 billion in civil penalties to the federal government. And now the state attorneys general have lined up to collect their share for consumer protection violations.
State AGs Happy Their States Are Compensated Too
States are claiming that this is a major victory for them because attorneys general there want to be able to enforce state consumer protection laws against national banks. According to Iowa Attorney General Tom Miller, one of four state attorneys general who led the investigation leading to the agreement, said “this agreement is unique and one of the largest multistate settlements with a bank since the national mortgage settlement in 2012.”
Related Resources:
- Wells Fargo Misled Customers, Whistleblower Claims (FindLaw In House)
- Wells Fargo Sued for Allegedly Knowing Auto Insurance Hurt Customers (FindLaw In House)
- Wells Fargo Sets Record for Largest Fine Received From CFPB (FindLaw Common Law)
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